The proposed acquisition marks the Bentonville, Ark.-based retail giant's first foray into the growing sub-Saharan African market. However, the deal faces opposition from labor unions concerned at what the possible "Walmartization" of the local retail industry.
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IF ANYONE still questions whether Africa really is the next big investment play, at least one seriously big hitter, the world’s largest retailer, has no such doubts. Wal-Mart’s $2,3bn offer for 51% of SA-based Massmart is the Arkansas- based company’s second biggest investment in more than a decade. In that time, Wal-Mart has grown its non-US revenue from virtually zero to a quarter of its annual 400bn turnover.
The significance of this investment — and let’s not forget Wal-Mart was prepared to stump up double the amount for all of Massmart — has not been lost on audiences in SA or elsewhere. Recently, for instance, the Daily Record newspaper reported that farmers in far-off Uganda were likely to benefit from the deal. It predicted Wal- Mart would "extend its experience in connecting farmers with the supermarket’s global supply chain, boosting farmer incomes, and (helping) them improve the quality of their produce".